South Africa’s e-commerce sector is growing and contributed to the worldwide growth rate of 29% in 2020. Per Statista Digital Market Outlook, this upward trend is expected to continue at a compound annual growth rate (CAGR) of 11 percent from 2020 to 2024. As with other markets, this growth has been spurred by the pandemic as well as technological advances and innovation in e-commerce.
Clothes, electronics, footwear, household appliances, and health products are the most popular categories among online shoppers in South Africa. Fresh food features relatively high among the new top categories due to the lockdown measures, boosting grocery delivery apps.
While the South African e-commerce market presents promising business opportunities, tapping into the industry is not without challenges. Overcoming these hurdles means learning about and understanding the region’s diverse landscape and culture.
Here are some tips from Global Sources when entering the market and how you can sustain business success in the region.
- Conduct market analysis. Not every market is suitable for every small and medium-sized enterprise (SME). This is where intensive market analysis is crucial. It shows the viability and how much potential a market has.
- Identify challenges in market entry. Apart from having a good understanding of the market, it’s important to know the barriers to a successful entry such as import bans or product registrations. It’s also vital to build and maintain a network to generate sales.
- Respect cultural differences. There’s no general formula for dealing with African business partners. The region is too large and diverse, so it’s important to take into consideration its different cultures.
Check out Global Sources for the latest market insights, industry trends and smart sourcing tips.